India's NSE stock futures listed on Singapore Exchange climb as much as 1.3 pct to an all-time high of 10,362.50.
India's cabinet approved $32.43 bln plan on Tuesday to recapitalise its state banks over the next two years.
"We view this announcement to be positive as high levels of non-performing assets and inadequate bank capital have severely constrained India's growth," ANZ Research analysts write in a note.
"The recap package – takes care of all requirements in one stroke," Nomura writes, adding that it should drive a re-rating in PSU banks with highest positive impact on Punjab National Bank.
Banking stocks rallied on Tuesday ahead of the news conference on expectations of a recapitalisation plan. The Nifty PSU bank index closed 3.8 pct higher.
